Ball Gum Category Remains The Top Attraction In Bulk Vending Channel

U.S.A. — Trends may come and go, but gumballs are forever. For generations, they have been synonymous with bulk vending. After all, the general public doesn’t call bulk venders “gumball machines” for nothing. Gumballs are simple, familiar and ubiquitous. Even among some bulk vending operators, the attitude seems to be that if you’ve seen one gumball, you’ve seen them all. But that attitude is changing. As overhead in the industry continues to steadily rise and profit margins shrink, operators and manufacturers are taking a second look at the spherical confections.

“Ball gum is still the mainstay – it’s something that has been around, it has built this business and will always been a part of it,” said A&A Global’s Phil Brilliant. “Over the years, we’ve seen different flavors and styles, from hot buttered popcorn to tropical flavors, but it has always been there and will continue to be there for the operator.”

The reasons behind ball gum’s longevity and continued popularity in the industry are both simpler and more complicated than might be supposed. For one thing, kids continue to buy gum from machines. Gumballs are a known commodity, but they are also continually evolving to keep up with current trends in taste, as evidenced by the increased number of flavors in recent years. When Carousel recently unveiled its pomegranate-flavored gum, what would have once been seen as overly exotic was widely accepted.

“We’re trying to attract parents who are a little more health conscious,” explained George Stege, president of Carousel’s parent,Ford Gum and Machine Co., referring to the strategy behind this latest flavor. “Pomegranate is popular now because it’s an antioxidant. We’re also introducing sugarless gum, which is a new direction for us. We’re coming out with two new sugarless items – one is fruit mix and the other is pomegranate.”

According to Stege, American consumers – both adults and children – are also developing a taste for what he termed “extreme flavors,” the intensely sour or hot. “If you take a look at the market, the high-intensity mints have clearly carved out a niche for themselves that didn’t exist 10 or 12 years ago,” he said. “These high-intensity flavors, whether mints, fruits or hot, have changed American tastes. And that’s a good thing. I think, as we get involved in these high-intensity flavors, it will attract additional markets.”

The same could be said for the recent trend in tropical fruit flavors, such as papaya, which have proved popular with the growing Latino demographic. And, too, innovations in the flavor industry have spurred combinations that would have been unheard of just a few years ago. These new flavors, such as watermelon-strawberry, first enter the market through retail items, such as soft drinks, and eventually find their way to gumballs. Just as youth culture cycles through pop music groups, movies and video games, the same can be said for its taste in confections. What’s hot today is not hot tomorrow, and that goes for flavors, too.

“One of the reasons our company is increasing its sales is because we bring new products to the market,” said Jerry Tubbs, vice-president of sales for Sweetworks, Oak Leaf’s parent company. “We have new SKUs coming out regularly. The operators are demanding that you have something fresh and something new on a regular basis, and we listen to operators and know we have to react.”

The operators, of course, are taking their cues from their customers, who demand change. Just as bulk vending operators know that frequent changes in capsuled or flat vendibles offered in machines boost sales, they have also discovered that changes in ball gum flavors have almost the same effect.

STILL PROFITABLE

And then there is the not-so-insignificant fact that profit margins for ball gum remain higher than those of many other items, including toys. Gumballs may not empty from a machine in weeks, but vend for vend, they continue to pay off handsomely for operators. “We make more money off of a gumball than we do from toys. And the more money we can make off of gumballs, the more toys we can put in the machine,” said Scott Ausmus, operating manager of Vend-all (Farmington, MN). “Oak Leaf’s Thunderbolts is probably the number-one seller for us, with Blueberry right behind that, but we’ve been trying a number of different flavors. And the traditional ones – the regular assorted – still sell.”

According to Ausmus, a good percentage of sales in many locations continues to come from employee purchases. “All you need is two or three people at a location and they can empty a machine in a month,” he said. “But you have to have the right flavor in the machine.”

Ball gum is also coming into play as operators increasingly adopt a business model that calls for building density locations on their routes. With fuel and other overhead costs increasing, operators are now aggressively seeking out smaller locations between major stops. The machine of choice for these so-called “filler locations” is typically a small single- or two-head rack or spiral filled with a standard assorted gumball mix. For instance, adding a half dozen or so stops comprised of single or double heads between two far-flung locations can go a long way toward taking the bite out of increased fuel costs.

Many of these locations, operators point out, are non-traditional bulk locations that can’t accommodate more than the most basic machine. And, because they may never have offered bulk vending before, ball gum remains a favorite “door opener” for operators into these locations. After all, location management may not understand capsuled merchandise or a “sticker machine,” but they understand a “gumball machine.”